WASHINGTON — The Senate's debate on overhauling the nation's financial regulatory system is also a fierce fight to woo voters in the 2010 congressional elections.
Lawmakers with shaky re-election prospects have been highly visible, promoting themselves as champions of the embattled consumer and the small-business owner.
Democrats have been particularly aggressive in using the debate, which entered its third week Monday, as a political platform.
"There aren't a lot of issues where Democrats can play offense," said Peter Brown, the assistant director of the Quinnipiac University Polling Institute in Connecticut. "The public is thinking about the economy, debt, health care and Afghanistan, and in every case, the White House has to play defense."
When it comes to Wall Street, however, Democrats could have the edge. "People still tend to think of Republicans as the party of the rich," Brown said.
Nowhere is that likely to be more evident than in Arkansas, where two-term incumbent Sen. Blanche Lincoln has been locked in a primary duel with Lt. Gov. Bill Halter.
Halter, a favorite of liberals, tried to paint Lincoln as out of touch with the average Arkansan, but Lincoln, who polls find has opened up a commanding lead in Tuesday's primary, struck back by toughening the financial overhaul bill.
As the chair of the Senate Agriculture Committee, she defied Democratic leaders by pushing through measures to require banks to spin off their lucrative but opaque derivatives practices into free-standing subsidiaries. Derivatives are the exotic financial instruments that helped trigger the nation's 2008 economic collapse.
"Everyone was convinced she'd do what she's always done, craft a narrowly tailored compromise, and she may have done that if Halter hadn't been in the race," Arkansas Poll Director Janine Parry said.
Instead, "she did something that could be a win for her. It's not that anyone understands what derivatives are, but there's a perception she's helping the little guy."
It's widely expected that Lincoln's derivatives package will be diluted before a final vote on the bill, but Democratic leaders have put off any such action, and even serious discussions, until after Tuesday's primary.
Courtney Rowe, a Lincoln spokeswoman, said the senator "absolutely has not asked" for any such delay, adding, "She's said repeatedly, 'Let's have this debate.' "
Jim Manley, a spokesman for Senate Majority Leader Harry Reid, D-Nev., said party leaders were trying to "spread amendments throughout the caucus," including "those that are up (for re-election) — and the freshmen that want to play a key role in reforming Wall Street."
Other Democrats also are positioning themselves to get maximum exposure from the bill, which would make it easier for the government to break up ailing financial institutions.
The first vote on an amendment, on May 5, was a bid by Sen. Barbara Boxer, D-Calif., to assure that taxpayers aren't responsible for any bailouts of financial institutions.
While the legislation included no such bailouts, Boxer, who could face a serious challenge for re-election this fall, told the Senate, "The American taxpayers should never again have to bail out Wall Street firms that gambled away our savings and wreaked havoc on our economy."
A few days later, the Senate approved a proposal by Sen. Michael Bennet, D-Colo., to reduce the size of the Troubled Asset Relief Program's bailout fund by $150 billion, and require that any repaid money be used to pay down the deficit.
"It's time we stood up for Main Street against Wall Street's greedy and reckless behavior," he declared.
Chances are that his proposal won't matter much, since the $700 billion fund, which he'd shrink to $550 billion, hasn't been fully used, and about $180 billion already has been repaid.
However, spokesman Trevor Kincaid called Bennet's plan "a small step in the right direction. . . . He knows there is much more work to be done."
Bennet faces a primary challenge from former state House Speaker Andrew Romanoff in what's shaping up as a close August contest. Should Bennet survive, polls show him in a tough race with one of these potential Republican challengers: former Lt. Gov. Jane Norton, Weld County District Attorney Ken Buck or former state Sen. Tom Wiens.
Republican senators also have been playing to the voters, notably two of the party's more vulnerable incumbents, Iowa's Charles Grassley and Arizona's John McCain.
Grassley was the only Republican to back Lincoln's derivatives plan in the Agriculture Committee and one of two Republicans to co-sponsor a Democratic-authored proposal that would make it harder for Wall Street firms to shop for friendly credit-rating agencies.
Grassley was ahead by 9 percentage points in his re-election bid in a May 3-5 Research 2000 poll.
McCain, who faces a tough primary in August against J.D. Hayworth, a former congressman who's a radio talk-show host, waged a lengthy, unsuccessful fight to end government control of mortgage financial titans Fannie Mae and Freddie Mac, which have received billions in government help and continue to lose billions of dollars.
All these stands should help senators as they head home for their 2010 campaigns.
"Legislation like this is complicated, and if you can frame the issue in a way people understand, it can help," said John Geer, a professor of political science at Vanderbilt University.
ON THE WEB
Senate Banking Committee report on financial overhaul bill
Senate Agriculture Committee report on derivatives bill
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